Biggest reduction in risk-of-poverty rate since financial crisis - PM

Portugal's prime minister, António Costa, said on Wednesday that the country last year registered the largest decrease in its rate of risk of poverty since the onset of the financial crisis, in a speech in which he criticised those who call for rolling back the state.

Costa made the remarks in opening the fortnightly debate in parliament, in a speech in which he argued that since his minority Socialist government took office in late 2015, the country has enjoyed "more growth, better employment and more equality".

In a criticism of the right-of-centre opposition, the prime minister said that two years ago "many pronounced that it was impossible and as many again predicted failure" for the policies put forward by his government.

"Because [the critics said] we could not grow [by] restoring income to households, because the parliamentary majority we built [with support from far-left parties] would put at risk the country's international commitments, because the only path was austerity," he said. "The results achieved over these two years of government demonstrate exactly the opposite."

Turning to opposition deputies, Costa then said: "They may question the strategy, they may not agree with the policies, but they cannot contest reality".

According to the prime minister, "the restoration of incomes and the rebuilding of social policies contributed in 2016 to the most significant reduction in the rate of risk of poverty since the start of the financial crisis."

The importance of changing the policies in place when the government came in, "based on the idea of a minimalist welfare state and in an illusory promise of 'social ethics in austerity', becomes still more clear when one notes that the risk of poverty has fallen by even more among children and young people and among the elderly," he said.

Costa cited recent indicators released by the National Statistics Institute (INE) that he said "foresee for 2017 more significant improvements" in this regard. In particular, "the rate of material privation has fallen 3.6 percentage points since 2015 and the rate of severe material privation has gone from about 10% in 2015 to 7% in 2017... in both cases the lowest values since 2005."

However, he warned, more work has to be done in the field in the next few years, because "the wounds caused by the crisis are far from having healed", with €2 billion less wealth than before the crisis, 300,000 fewer jobs than in 2008 and "poverty intensity" four percentage points above its level that year.

It is against that background, Costa said, that the government had on Tuesday tabled a proposal to increase the minimum monthly salary to €580 euros. Negotiations between government, employer organisations and trade unions on the subject continue.

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